As you retire and things begin to slow down, more and more of your days can be devoted to whatever it is you enjoy. That’s one of the luxuries of having worked hard your entire life. Finally, you get time to enjoy yourself, your loved ones, and the life you’ve created.
So, don’t waste this hard-earned time attempting to maintain a home that’s much larger than you need. Downsize to a senior-friendly home and relax as much as possible. Then, decide whether you should sell your old home, rent it or hold onto it.
Hold Tight to Your Home Until the Time Is Right
Leaving the house you’ve raised a family in, or have spent years in yourself, can be stressful. So, why not hold on to it? There are lots of factors that go into deciding whether you should keep a property after moving on, so consider moving expenses, upkeep, and more.
First, can you afford the moving expenses you’ll be incurring through downsizing without the equity in your old home? If you don’t have enough savings to comfortably cover costs on your fixed or soon-to-be fixed income, maybe it would be best to let it go. However, if you can afford these costs, it might be best to sit on the property and wait for the best time in the market to sell.
According to SeniorLiving.com, “The median income for seniors 65-74 is $36,320; if you’re over 74, that drops to $25,417.” Even if you’re downsizing to cut back, the medical care you need — and its cost — will only grow the older you get. So, it might be in your best interest to save for the future and cash out when you can.
If you’re still on the fence about your current and future finances, contact a real estate agent to help in researching the local market to see if selling the property is the most sensible option. What are homes in your neighborhood selling for? For example, Redfin points out that home in Naples sold for an average of $329,000 over the past month. Keep an eye on the market, and if you can, wait until the numbers are in your favor before pulling the trigger.
Fulfill Your Family’s Wish and Keep the Home
So, you can afford to keep the home and pay property taxes and for its upkeep while you’re away. Passing on a piece of your life can be a great gift for your family to remember you by. Besides, your home could be the most valuable asset you have, which only adds to your gift.
Ensure your family will be the ones benefiting from your legacy by taking any steps you can now. Depending on your situation, there are a number of ways you can go about this. Upon your death, you could have the deed transferred to an heir or bequeath the home.
If you want to take action now, go ahead and set up a revocable living trust or sell the home outright to your kids. According to RBC Wealth Management, “Another option is to establish a Qualified Personal Resident Trust… which transfers ownership of the home to a trust.”
Speak with an advisor before going in any direction to protect you and your family from problems. In the end, do what’s in your best interest, and your family should respect that.
Reel in Supplemental Income with a Rental
As you get older, and it’s going to take more and more of your resources to get the care you’ll eventually need. If you plan on leaving the home to your family upon death, take advantage of this asset now and become a landlord. While it’s not exactly passive income, you can hire professional property managers to help with the day-to-day tasks, such as responding to phone calls and maintenance requests or complaints. These sorts of services aren’t free, but you can set aside the cost for their services and still make some money if it’s done correctly.
There are costs to renting, but if the home is going to sit empty, bring in money to offset the costs of property taxes and general upkeep. Besides, a tenant should notify you of anything that goes wrong when it happens, so you won’t have any surprises when you go back to visit.
When downsizing, it’s important for you to examine every option that comes to your old home. Any decision you make could result in either benefiting or hurting your golden years. Make the most of the resources you spent years attaining.
Article by Jim Vogel